SRA Code of Conduct 2011 - You and others
Version 2 (Superseded)

Version 2 of the Handbook was published on 23 December 2011, and was superseded by Version 3 on 18 April 2012. For more information, click "History" above.

4th Section: You and others

Chapter 11: Relations with third parties

This chapter is about ensuring you do not take unfair advantage of those you deal with and that you act in a manner which promotes the proper operation of the legal system.

This includes your conduct in relation to undertakings; there is no obligation to give or receive an undertaking on behalf of a client but, if you do, you must ensure that you achieve the outcomes listed in this chapter.

The conduct requirements in this area extend beyond professional and business matters. They apply in any circumstances in which you may use your professional title to advance your personal interests.

The outcomes in this chapter show how the Principles apply in the context of your relations with third parties.

Outcomes

You must achieve these outcomes:

O(11.1)

you do not take unfair advantage of third parties in either your professional or personal capacity;

O(11.2)

you perform all undertakings given by you within an agreed timescale or within a reasonable amount of time;

O(11.3)

where you act for a seller of land, you inform all buyers immediately of the seller's intention to deal with more than one buyer;

O(11.4)

you properly administer oaths, affirmations or declarations where you are authorised to do so.

Indicative behaviours

Acting in the following way(s) may tend to show that you have achieved these outcomes and therefore complied with the Principles:

IB(11.1)

providing sufficient time and information to enable the costs in any matter to be agreed;

IB(11.2)

returning documents or money sent subject to an express condition if you are unable to comply with that condition;

IB(11.3)

returning documents or money on demand if they are sent on condition that they are held to the sender's order;

IB(11.4)

ensuring that you do not communicate with another party when you are aware that the other party has retained a lawyer in a matter, except:

(a)

to request the name and address of the other party's lawyer; or

(b)

the other party's lawyer consents to you communicating with the client; or

(c)

where there are exceptional circumstances;

IB(11.5)

maintaining an effective system which records when undertakings have been given and when they have been discharged;

IB(11.6)

where an undertaking is given which is dependent upon the happening of a future event and it becomes apparent the future event will not occur, notifying the recipient of this.

Acting in the following way(s) may tend to show that you have not achieved these outcomes and therefore not complied with the Principles:

IB(11.7)

taking unfair advantage of an opposing party's lack of legal knowledge where they have not instructed a lawyer;

IB(11.8)

demanding anything for yourself or on behalf of your client, that is not legally recoverable, such as when you are instructed to collect a simple debt, demanding from the debtor the cost of the letter of claim since it cannot be said at that stage that such a cost is legally recoverable;

IB(11.9)

using your professional status or qualification to take unfair advantage of another person in order to advance your personal interests;

IB(11.10)

taking unfair advantage of a public office held by you, or a member of your family, or a member of your firm or their family.

In-house practice

The outcomes in this chapter apply to your in-house practice.

Overseas practice

The outcomes in this chapter apply to your overseas practice, except that Outcome 11.3 only applies if the land in question is situated in England and Wales.

Notes

(i)

This chapter should be read in conjunction with Chapter 7 (Management of your business) in relation to the system you will need to have in place to control undertakings.

Chapter 12: Separate businesses

The purpose of this chapter is to ensure clients are protected when they obtain mainstream legal services from a firm regulated by the SRA. This is accomplished by restricting the services that can be provided through a separate business that is not authorised by the SRA or another approved regulator.

This chapter addresses two kinds of services:

  1. those which you cannot offer through a separate business ("prohibited separate business activities"). These are "mainstream" legal services which members of the public would expect you to offer as a lawyer regulated by the SRA or another approved regulator; and
  2. those which you can offer either through a separate business ("a permitted separate business"), or through an authorised body. These are the kind of services a member of the public would not necessarily expect to be provided only by a lawyer regulated by the SRA or another approved regulator, but which are "solicitor-like" services.

Clients of a permitted separate business will not have the same statutory protections as clients of an authorised body and it is important that this is clear to clients of the separate business, particularly where they are being referred from one business to the other.

The outcomes in this chapter show how the Principles apply in the context of separate businesses.

Outcomes

You must achieve these outcomes:

O(12.1)

you do not:

(a)

own;

(b)

have a significant interest in; or

(c)

actively participate in,

a separate business which conducts prohibited separate business activities;

O(12.2)

if you are a firm:

(a)

you are not owned by; or

(b)

connected with,

a separate business which conducts prohibited separate business activities;

O(12.3)

where you:

(a)

have a significant interest in;

(b)

actively participate in;

(c)

own; or

(d)

are a firm and owned by or connected with,

a permitted separate business, you have safeguards in place to ensure that clients are not misled about the extent to which the services that you and the separate business offer are regulated;

O(12.4)

you do not represent any permitted separate business as being regulated by the SRA or any of its activities as being provided by an individual who is regulated by the SRA;

O(12.5)

you are only connected with reputable separate businesses;

O(12.6)

you are only connected with a permitted separate business which is an appointed representative if it is an appointed representative of an independent financial adviser.

Indicative behaviours

Acting in the following way(s) may tend to show that you have achieved these outcomes and therefore complied with the Principles:

IB(12.1)

ensuring that client information and records are not disclosed to the permitted separate business, without the express consent of the client;

IB(12.2)

complying with the SRA Accounts Rules and not allowing the client account to be used to hold money for the permitted separate business;

IB(12.3)

where you are referring a client to a permitted separate business, informing the client of your interest in the separate business;

IB(12.4)

terminating any connection with a permitted separate business where you have reason to doubt the integrity or competence of that separate business.

In-house practice

Outcomes 12.1 and 12.3 to 12.6 in this chapter apply to your in-house practice.

Overseas practice

If you practise from an office outside England and Wales and you have a separate business, Outcomes 12.3 to 12.6 in this chapter apply to you.

Notes

(i)

It is important that clients are not misled or confused about the regulatory status of a permitted separate business, the services it provides and the people working within it. Particular care needs to be taken regarding:

(a)

the name or branding of the separate business;

(b)

misleading publicity; and

(c)

the proximity of the permitted separate business to your firm, particularly if you share premises.

(ii)

This chapter should be read in conjunction with:

(a)

Chapter 3 (Conflicts of interests)

(b)

Chapter 6 (Your client and introductions to third parties); and

(c)

Chapter 8 (Publicity).